Vocational versus general education: Employment and earnings over the life course in Switzerland.

Abstract

After the Great Recession, vocational training was strongly promoted across the OECD as a measure to fight youth unemployment. Vocational degrees may give workers a head start in the labour market. However, these degrees may also become obsolete sooner and leave older workers vulnerable to technological change. We thus compare the evolution of employment and earnings over the life course for holders of vocational and general education at the upper-secondary level. We use a cohort design for Switzerland, the OECD country with the highest share of youth undertaking vocational education. Based on the Swiss Labour Force Survey 1991-2014 and the Swiss Household Panel 1999-2015, our results show that employment prospects remain as good for vocational as for general education over the second half of workers' careers. However, vocational education is associated with substantially lower earnings once workers enter their thirties, and this disadvantage is larger among women than men. While vocational degrees protect against unemployment, they come at the cost of flat earnings curves over the life course.